"Hold me back from shooting off a sky-rocket, from throwing out the confetti" Hill said.

Indian government will have to authorize the wiring of the money out of the country.

"The second quarter will be better than the first quarter," said Stephen Annis.

We're on to the core of a press-release the bank sent out: revealing that the bank's first quarter report of losses was one-fifth of its real losses.

"When the regulators looked at our numbers they found additional loans that they felt should be impaired," Annis said. "We chose to go back and re-look at our first quarter."

The losses were in residential development loans.

"A large part of the issue is interpretation. Even stringent accounting guidelines are open to interpretation," Annis said.

Regulators take a very dark view of the recoverability of "impaired" loans.

There are $41 million in loans that have current payments on San Joaquin's books are impaired, Hill said.

San Joaquin is a commercial bank — doing business with businesses.

Annis, the bank's Executive Vice President, said the underlying strength of those loans is what attracted the Indian investors.

My post from back in April 2008....why did they lower their loan loss reserves last year?? Mistake or Fraud or Incompetence? (or all of the above):

 http://bakersfieldbubble.bl...

The bottom line financial stats on the first quarter - the bank originally reported a $3.6 million loss in the first quarter. They have now re-reported a $18.2 million loss in the first quarter.

bubble, my good friend Gretchen Wenner is asking about that right now. 

I'm not sure I understand the conversation well enough to post here accurately so I'll have her explain it in her story.

Also, why has the stock been dropping? Someone knew something and they have been selling like crazy! This should have been diclosed via an 8k if this was already "public knowledge"!

Annis is talking about the dilution of shares.

"If this additional capital really causes the company to become more sound, then the value of those existing shares to go up."

Gretchen is asking about last week's value crash.

"What was going on," she's asking. "Did someone hear about this deal?"

"We don't know," Annis said.

He's talking about why Bank of America dropped under $2. Investors didn't trust that the BofA was healthy.

San Joaquin had applied for federal stimulus funds and then pulled the application, Annis said.

"We decided we didn't want the federal money," Hill said.

 "What was going on," she's asking. "Did someone hear about this deal?"

Thanks. I will wait for any SEC filings by insiders too see if it was them. If it was not an insider, then we will probably never know.

Either way, this thing smells fishy to me. Reducing loan losses, then restating earnings, then massive selling based on zero news, then dilution of the stock via this transaction. Either these guys are incompetent or something else.

"I think our shareholders are going to be pleased that we're down to the bone on the problems," Hill said.

The bank has found the problem loans, assessed the damage and investors will understand that and look for the stock to rebound now that it has been recapitalize.

Second half of the year looks good for the bank. (they expect profits in the second half of the year, but not enough to offset the first half losses.)

Annis - they expect to be profitable next year.

"This is our first lost year and we're not happy about it," Hill said. "We're all over curing it and we're all over it never happening again."

They didn't want federal money, but are more than happy to take money from foreign interests. Wow.

Bart Hill.

He related to Sam Hill?

 "I think our shareholders are going to be pleased that we're down to the bone on the problems," Hill said.

After the stock goes down 94%. LOL!!

James or Gretchen - Any idea what this SEC filing was all about:

On June 23, 2009, San Joaquin Bancorp entered into indemnification agreements with each member of the Company’s Board of Directors (the “Board”) and each Named Executive Officer (“NEO”). The indemnification agreements indemnify each of the directors and NEOs against expenses or liabilities incurred in connection with the investigation, defense, settlement or appeal of any proceeding associated with the indemnitee being an agent of the Corporation or by reason of anything done or not done by the indemnitee in such capacity. The form of indemnification agreement is attached as exhibit 10.1 and incorporated herein by reference.

http://yahoo.brand.edgar-on...

same filing also included this:

These measures are effective July 1, 2009 and include, among others, the elimination of all remaining personal expense allowances, if any, for NEOs and all directors’ fees for the remainder of 2009.

http://yahoo.brand.edgar-on...

Bart Hill is on the Bakersfield Californian Board of Directors and Virginia Morehouse is on the Board of Directors of the San Joaquin Bank.  One hand washes the other...

Cheshire,

Yes, I know Bart Hill is on The Californian's board and Ginger is on SJB's. We've reported Mr. Hill's salary (and changes over the past year) and report such board relationships when editors determine it is material to the story.

Thanks as ever for comments!

-- Gretchen Wenner, staff writer

Gretchen, don't you see a conflict of interest here with Hill and your boss being on each other's Boards and then expecting the Bakersfield Californian to cover this fiasco of a banking operation?  Editors are supposed to determine if "it is material to the story" and they themselves are supervised by Morehouse?  Doesn't it seem clear why journalism has a bad reputation as this starts to appear as a repeat of the decades old episodes of the Bakersfield Californian covering up certain messes in Bako for their friends and "important" people.  It's disgusting...

Reposting Cheshire Cat's blog-breaking post from last night. Remember folks, don't cut and past from the net without stripping any hidden HTML code first. Use the clipboard with a "T" on it.

Here's the post:

Gretchen is asking about last week's value crash."What was going on," she's asking. "Did someone hear about this deal?"

Hey Gretchen, this bank was the "talk of the town" all week! Where have you all been at the BC? Why don't you ask your publisher since she's been on the bank's board since 2002 and was compensated $25,250 in 2008? Jeeze...

Virginia F. (Ginger) Moorhouse
Director
San Joaquin Bancorp CA
Bakersfield , CA 64 Years Old Virginia F. (Ginger) Moorhouse has served as a member of the Bank"s Board of Directors since 2002. Ms. Moorhouse has served as Publisher and Chairman of the Board of The Bakersfield Californian, a newspaper publishing company, since 1994.
Director Compensation (San Joaquin Bancorp CA) 2008
Fees earned or paid in cash $15,750.00 Stock awards $0.00 Option awards (in $) $9,500.00 Non-equity incentive plan compensation $0.00 Change in pension value and nondisqualified compensation earnings $0.00 All other compensation $0.00 Total Compensation $25,250.00
Director Compensation (San Joaquin Bancorp CA) 2007
Fees earned or paid in cash $15,750.00 Stock awards $0.00 Option awards (in $) $9,500.00 Non-equity incentive plan compensation $0.00 Change in pension value and nondisqualified compensation earnings $0.00 All other compensation $0.00 Total Compensation $25,250.00
Director Compensation (San Joaquin Bancorp CA) 2006
Fees earned or paid in cash $14,250.00 Stock awards $0.00 Option awards (in $) $6,933.00 Non-equity incentive plan compensation $0.00 Change in pension value and nondisqualified compensation earnings $0.00 All other compensation $0.00 Total Compensation $21,183.00

God Bless The Rich!